European Financial Systems 2017 - Proceedings of the 14th International Scientific Conference (Part 1)

The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies

The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies
(The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies)

Author(s):Katarína Belanová
Language:English
Subject(s):Business Economy / Management, Micro-Economics, Financial Markets
Page Range:11-14
No. of Pages:4
Keywords:investment; cash flow sensitivity; capital market imperfections; financial constraint;
Summary/Abstract:A company usually has get at least part of financing for investment projects from financial markets. If financial markets are perfect, the choice of the sources of finance does not influence investment decisions. Since financial markets are imperfect, companies find that external finance is costly or rationed. Especially small and medium – sized companies (SMEs) have difficulties in getting external financial sources. As a result, corporate investment is sensitive to the amount of internal funds. The aim of the article is to survey the impact of financial market imperfections on firm investment on the sample of 53 automotive companies in the SR. The survey was carried out during the year 2011. Using augmented accelerator model, we find supportive evidence for the fact that companies which are supposed to be more financially constrained exhibit greater investment – cash flow sensitivity. Our findings support the results of Fazzari et al. (1988) who also find that investment spending of firms with high levels of financial constraints is more sensitive to the availability of cash flow

The Development of Gross Premiums Written in Life Insurance in the Czech Republic

The Development of Gross Premiums Written in Life Insurance in the Czech Republic
(The Development of Gross Premiums Written in Life Insurance in the Czech Republic)

Author(s):Karina Benetti
Language:English
Subject(s):Socio-Economic Research
Page Range:15-22
No. of Pages:8
Keywords:life insurance; development; gross premium written;
Summary/Abstract:Life insurance industry over the last decade has changed greatly, not only in the offer of products. Originally this type of insurance resulted to cover the consequences of the risk of death and survival. Products of life insurance covering the risk of death should provide family of in case of death of the breadwinner, products aimed at the risk of life expectancy were mainly-saving products which should primarily secure the individual in old age. It was also possible to arrange a product called mixed life insurance. It is worth mentioning that there are various modern variations and possibilities of arranging the different kinds of insurance within the life insurance of people. The product development is escalated in investment life insurance product, which has its strengths, but also weaknesses. The main objective of this paper is to capture the main trends of gross life insurance premium, focusing on changes in gross premiums written by individual types of life insurance products including the analysis of selected parameters (number of insurance contracts, insurance penetration and other selected indicators). The software STATGRAPHICS Centurion will be used for this analysis.

Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices

Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices
(Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices)

Author(s):Miloš Bikár, Miroslav KMEŤKO, Katarina Vavrová, Peter Badura
Language:English
Subject(s):Business Economy / Management, Economic policy, Financial Markets
Page Range:23-32
No. of Pages:10
Keywords:stock price indices; market and exchange rate volatility; price correlations; monetary policy; behavioural effects;
Summary/Abstract:Movements on the global financial markets are nowadays interconnected and influenced by both fundamental and behavioural or psychological effects. During the last couple of years, besides of standard corporate results and predictions, the market volatility is significantly trigger by monetary policies of central banks and policy makers. Nevertheless, many investors find stock market indices as an appropriate way for their investments, especially at time of low bond yields. The objective of this paper is to analyse the time-varying nature of selected world stock market indices by using a correlation model as well as to evaluate the influence of behavioural effects of market participants on the volatility. The output from the model confirmed the negative correlation among selected stock indices and volatility, while real effective exchange rates effect differs. The paper highlights key aspect having weight on stock markets mainly the central bank monetary policies, public debts, currency pair fluctuations, as well as inflation levels.

Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach

Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach
(Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach)

Author(s):Mária Bohdalová, Michal Greguš
Language:English
Subject(s):EU-Accession / EU-DEvelopment, Financial Markets
Page Range:33-40
No. of Pages:8
Keywords:risk; quantile regression; stock market; Brexit;
Summary/Abstract:The aim of this paper is to give a comprehensive description of the risk dependence and interdependence between selected European stock markets and Brexit equity in the period spanning from January, 7, 2000 to February, 3, 2017. We have studied behavior of extreme quantiles using quantile regression approach. This approach is robust because it is based on the use of various measures of central tendency and dispersion statistics for a detailed analysis of the relationship between variables. We have found evidence of significant interdependence/independence between financial markets and Brexit. The analysis of upper and lower quantiles allows to observe that the interdependence is positive asymmetric and higher for bear markets compared to bear or normal markets conditions.

Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies

Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies
(Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies)

Author(s):Mária Bohdalová, Natália Klempaiová
Language:English
Subject(s):National Economy, Business Economy / Management, Transport / Logistics
Page Range:41-49
No. of Pages:9
Keywords:Index IN05; bankruptcy model; logistic regression;
Summary/Abstract:The aim of the paper is to analyze bankruptcy model IN05 to determine its usability for private civil engineering companies in Slovakia. The analysis has been carried out using a sample of companies obtained from a Slovak database called FinStat. In this paper, we have analyzed data from a static point of view when we have used one year data, and from a dynamic point of view when we have analyzed samples of companies that have been bankrupt for the last 4 years. The reporting ability of the selected indicator IN05 is judged by the number of correct and incorrect predictions. We have found that the IN05 index is an appropriate model, the validity of which has been verified by logistic regression. We have found out the predictive power of the IN05 model is not reduced unless we consider the EBIT/interest expense and current assets/shortterm liabilities indicators. We have found that the index IN05 is a reliable model for civil engineering industry in Slovakia.

Factors that affect the market prices of flat renting

Factors that affect the market prices of flat renting
(Factors that affect the market prices of flat renting)

Author(s):Roman Brauner, Sylvia Plottová
Language:English
Subject(s):Financial Markets
Page Range:50-59
No. of Pages:10
Keywords:financial system; interest rate; prices of flat renting; central banks; inflation;
Summary/Abstract:This paper aims to investigate the factors influencing the level of market prices of flat renting in the Czech Republic, more precisely on big cities such as Prague or Brno. Firstly, it analyzes the development of market rent prices over the last 7 years and examines the specific factors which influenced this period. The subject of the research is also the relation of the difference in the development of the market prices rental according to flat size. In the paper we also focus on the influence of non-standard real estate price development behavior in cooperation with a significant decrease in interest rates on mortgage loans. An integral part of the comparison is the development of market rent prices with other markets bringing regular dividends, especially capital markets, or dependence on the development of alternative investments such as precious metals. On the basis of the achieved results, the conclusion predicts the future development of the market rentals in the Czech Republic.

The effect of premium framing on life insurance demand

The effect of premium framing on life insurance demand
(The effect of premium framing on life insurance demand)

Author(s):Zuzana Brokešova, Erika Pastoráková, Tomáš Ondruška, Miroslav Szabo
Language:English
Subject(s):Socio-Economic Research
Page Range:60-66
No. of Pages:7
Keywords:framing; premium; insurance demand; survey;
Summary/Abstract:In behavioral economics, framing effect represents a cognitive bias, in which the choice of the decision-maker is influenced by presentation of the decision problem. The specific formulation of the decision frame can thus incite individuals to choose a certain alternative. In the paper, we report preliminary results on the effect of price framing on the life insurance demand. Using the sample of 200 respondents, we test the differences in the attractiveness and demand for life insurance under different premium framing. In the between-subject setting, we identify statistically significant difference in the rating of the life insurance under various price formulations, controlling for socioeconomics characteristics. We do not observe the effect on the life insurance demand.

Application of selected financial performance methods to chosen industry in the Czech Republic

Application of selected financial performance methods to chosen industry in the Czech Republic
(Application of selected financial performance methods to chosen industry in the Czech Republic)

Author(s):Dana Dluhošová, Barbora Ptáčková, Dagmar Richtarová
Language:English
Subject(s):Business Economy / Management, Economic history, Transformation Period (1990 - 2010), Present Times (2010 - today), Accounting - Business Administration
Page Range:67-75
No. of Pages:9
Keywords:financial performance; financial ratios; analysis of deviations; pyramidal decomposition; economic value added;
Summary/Abstract:This paper is dedicated to financial performance evaluation of selected industry of the Czech Republic. Financial performance of the industry or company is a random process, which can be decomposed into the particular indicators. Very important is to find and to quantify main factors which influence financial performance of the industry the most. One of the possible ways is to apply the method of pyramidal decomposition to financial indicators. The aim of this paper is to evaluate financial performance of selected industry in the Czech Republic in the period 2007 to 2015 according to the methods of analysis of deviation and to find main value drivers of this selected industry. Annual data from the period 2007 to 2015 will be used for the analysis. The data for the analysis will be taken from the web site of Ministry of industry and trade of the Czech Republic. Firstly, financial ratios will be determined. Secondly, the method of pyramidal decomposition will be applied to selected financial indicators, such as profitability ratios, liquidity ratios and activity and debt ratios. Analysis of deviation will be then applied to particular financial ratios and dynamic analysis of selected industry financial performance will be performed. Evaluation of selected industry in the Czech Republic according to economic value added indicator will be included in the conclusion of the paper and also value drivers of this industry will be determined in the analyzed period.

Causes of the Foreclosure Crisis – Irrational or Rational Decisions?

Causes of the Foreclosure Crisis – Irrational or Rational Decisions?
(Causes of the Foreclosure Crisis – Irrational or Rational Decisions?)

Author(s):Bohuslava Doláková
Language:Polish
Subject(s):Economic history, Transformation Period (1990 - 2010), Financial Markets, Socio-Economic Research
Page Range:76-81
No. of Pages:6
Keywords:Financial crisis; Behaviour; Consumer behaviour; Rationality; Irrationality;
Summary/Abstract:The aim of this paper is to show non-traditional approach to the causes of foreclosure crisis in 2008. Most often used story is based on idea that the crisis was result of the finance market industry where market insiders betrayed uninformed mortgage borrowers and investors. But non-traditional approach argues that borrowers and investors made decisions that were rational and logical given their ex post overly optimistic beliefs about house prices. They expected situation would have been much different than it was, but they knew theoretical risks. This can show limits of our understanding of asset price bubbles and help to design policies and help us in crisis prediction system.

The dynamics of linkages between European currencies: How does it change according to the time of day?

The dynamics of linkages between European currencies: How does it change according to the time of day?
(The dynamics of linkages between European currencies: How does it change according to the time of day?)

Author(s):Małgorzata Domańska, Ryszard Doman
Language:English
Subject(s):Economic policy, Financial Markets
Page Range:82-90
No. of Pages:9
Keywords:exchange rates; European currencies; linkages; copula; Markov regime switching; tail dependence;
Summary/Abstract:The aim of the paper is to document how the dynamics of linkages between European currencies changes during a trading day according to the activity of different groups of traders, and show the impact of important events and news on the dependence structures. We analyze conditional dependencies between the Czech koruna, Hungarian forint, Polish zloty and the major European currencies (the euro, British pound and Swiss franc). The analysis is performed for the exchange rates against the US dollar. We consider daily returns calculated using the exchange rates quoted at different times of day. The dynamics of the dependencies is modeled by means of Markov regime switching copula models, and the strength of the linkages is described using dynamic Spearman’s rho coefficients and the dynamic coefficients of tail dependence. The approach used allows to scrutinize changes in the dynamics of the conditional dependence structure according to the time of day, which can be useful in recognizing diversification possibilities.

Closet Indexing in Czechia: An Extended Analysis

Closet Indexing in Czechia: An Extended Analysis
(Closet Indexing in Czechia: An Extended Analysis)

Author(s):Tomáš Dráb
Language:English
Subject(s):Financial Markets
Page Range:91-100
No. of Pages:10
Keywords:closet indexing; active investing; mutual funds; benchmark; Czechia;
Summary/Abstract:All active equity funds levy significant charges in exchange for an opportunity to outperform respective benchmark. However, many of these funds fail to implement active management in practice and resort to closet indexing. Evidence from abroad has shown that closet indexing has been widespread among funds offered on world’s most developed markets. The aim of this paper is a complete assessment of presence of closet indexing on Czech financial market through a deeper analysis of wide scope of funds offered to domestic retail investors. We found out that closet indexing is an issue of more than one third of the overall amount, but there is still sufficient number of truly active funds and certain signals where to expect closet indexer have been identified.

Implementation of cost model for effective planning of foreign military operations

Implementation of cost model for effective planning of foreign military operations
(Implementation of cost model for effective planning of foreign military operations)

Author(s):Jan Drbola, Miroslav Krč
Language:English
Subject(s):Public Administration, Economic policy, Military policy, Accounting - Business Administration
Page Range:101-108
No. of Pages:8
Keywords:cost model; public administration; accounting; life cycle of foreign operation; planning process;
Summary/Abstract:Current Military of Defense accounting system is based on expenditure base, thus this state is not suitable for planning or evaluation of each activities of military operation, because there are no sufficient accounting outputs. In accordance with this unsatisfactory state of accounting, this paper focuses on finding some measures that help to improve current system of planning and budgeting foreign operation in the whole life cycle period. The life cycle is divided into three separate time subperiods – preparation, foreign operation and evaluation. Pursuant this conditions, system of cost reporting, which calculate with cost assignment, is designed. This measure help to identify and determine real amount of all costs, relating with foreign acting. Most information come from used papers of Military of Defense, but most materials are used from countries abroad, where similar measures were implemented. In the paper is used method of description, analysis, synthesis, comparison, statistical methods or method of data modelling.

Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States

Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States
(Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States)

Author(s):Justyna Dyduch, Katarzyna Stabryła-Chudzio
Language:English
Subject(s):Energy and Environmental Studies, Economic policy, Environmental and Energy policy, Government/Political systems, EU-Accession / EU-DEvelopment, Fiscal Politics / Budgeting
Page Range:109-117
No. of Pages:9
Keywords:environmental taxes; tax earmarking; public revenues; environmental protection public expenditures; general government;
Summary/Abstract:Since many years in the European Union more attention has been paid to environmental taxes (also fees and other charges) as an important source of public revenues. It is argued that the increase in environmental taxes should raise the quality of the environment while at the same time ensuring budgetary implications. Despite the existence of non-assignment rule in the public finance there is no doubt that in the case of environmental taxes, fiscal targets are related to non-fiscal objectives. Consequently, the state demand for this source of revenues should stem from the necessity for environmental protection. The objective of the paper is to examine to what extent revenues from environmental taxes are allocated to finance environmental protection in the EU countries. The research is based on the Eurostat data on environmental tax revenues and environmental protection expenditures of the general government sector and covers the period 2006 to 2015. In most EU countries less than a half of environmental tax revenues has been spent on environmental protection. The average ratio of environmental protection expenditures to environmental tax revenues in the particular EU countries varies from 10.1% to 55.4%. In order to test the linear relationship between environmental taxes and expenditures it has been conducted the Pearson correlation analysis. A statistically significant, strong and positive relationship between these variables has been observed. The result could be interpreted in two ways: - more environmentally related taxes imply greater spending on environmental issues or - the growing need to comply with the EU obligations concerning environmental protection entails an increase in environmentally related tax burden.

Regulation of Insurance Market in Slovak republic

Regulation of Insurance Market in Slovak republic
(Regulation of Insurance Market in Slovak republic)

Author(s):Michal Fabuš, Viktória Čejková
Language:English
Subject(s):Law on Economics, Financial Markets
Page Range:118-126
No. of Pages:9
Keywords:insurance; insurance market; insurance market regulation; supervision of the insurance market; regulatory tools;
Summary/Abstract:In contribution, we deal with insurance market as part of the financial market. We will examine financial market from an economic and legal point of view, stating its segmentation as economic-legal category. As the insurance market is regulated by different laws and legal norms, we will deal closer with regulation of the insurance market and supervision of the insurance market. The contribution will also focus on the assessment of the level of the insurance market through selected indicators. In the contribution, traditional methods of analysis and synthesis will be used as well as analytical and statistical methods to characterize main selected indicators of the insurance market. At the end, we list the options for improving the regulation of the insurance market and supervision of the insurance market. The activity of commercial insurance companies in the Slovak insurance market will in the future be influenced by the development of information technologies, which must be used also for investment activity. Very important is the interconnection - Information highway between commercial insurance companies as well as between insurance companies and their clients. Qualified use of these information technologies will lead in the future to a reduction in service and thus to a competitive advantage.Clients of commercial insurance companies are inadequately informed, for example, about the residual value of life insurance claims. They do not have enough information on the disposable value of the indemnity in case of early termination of the insurance contract and are not informed of the disadvantage of early termination of the life insurance contract.The main objective of the regulation should be stability, security, credibility in the insurance market for clients of commercial insurance companies. Only an efficiently fufunctioning insurance market can ensure the performance and development of the economy.

To gamble or not to gamble – comparison of decisions made under risk and under uncertainty

To gamble or not to gamble – comparison of decisions made under risk and under uncertainty
(To gamble or not to gamble – comparison of decisions made under risk and under uncertainty)

Author(s):Maria Forlicz, Tomasz Rólczyński
Language:English
Subject(s):Socio-Economic Research
Page Range:127-134
No. of Pages:8
Keywords:decision under uncertainty; lottery; expected value;
Summary/Abstract:It’s been noticed that people estimating the probability of occurrence of some events underestimate large probabilities and overestimate small ones (Burns et al, 2010), which in the case of lotteries, where the probability of winning is very low, should effect increased willingness to play when the probabilities are not known. That is why we put forward a hypothesis that in the case of choice made under uncertainty people are more willing to buy lottery tickets than in the case of choice under risk (while the expected value of a gamble is smaller than the price of the lottery ticket). Two experiments with real (but not monetary) payoffs were organized. In both experiments participants were divided in two groups - informed and not informed about the probability of winning (different across experiments). Results of the Experiment I confirm our hypothesis. On average, the number of lottery tickets bought was higher in a group that didn’t know the probability of winning. However, when we lowered the pool in Experiment II this difference disappeared.

Comparison of the tax burden on natural persons in the Slovak Republic and Spain

Comparison of the tax burden on natural persons in the Slovak Republic and Spain
(Comparison of the tax burden on natural persons in the Slovak Republic and Spain)

Author(s):Katarína Gašová, Katarina Repkova Stofkova
Language:English
Subject(s):Economic policy, Comparative politics, Public Finances, Fiscal Politics / Budgeting
Page Range:135-142
No. of Pages:8
Keywords:taxes; income tax; public finance; tax-free income; child tax bonus;
Summary/Abstract:Redistributive function of public finance is provided through the state budget, which is formed as a balance of revenue and expenditure side. Revenues are redistributed and provided to citizens through public services. The primary source of the state budget revenues are taxes, which represent up to 95% of total revenues, based on individual years. Tax policy is a part of the state's fiscal policy and represents a set of measures, which govern the tax system. The Slovak Republic and the Kingdom of Spain are European Union member states which use the same currency. Both countries differentiate in many areas e.g. economics, geography etc. despite some common features. The aim of the contribution is to analyze the current situation in the field of tax burden on personal entity in the Slovak Republic and Spain. Authors conduct comparison and evaluation of the tax burden on personal entity in both countries, based on the example of an employee working in selected countries. Spain, unlike the Slovak Republic, also takes into account the origin of the tax during the tax burden calculation i.e. the area in which is tax levied. It results into different tax rates for different regions of Spain.

Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia

Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia
(Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia)

Author(s):Beata Gavurova, Eva HUCULOVA
Language:English
Subject(s):Higher Education , Socio-Economic Research, Pedagogy
Page Range:143-151
No. of Pages:9
Keywords:financial literacy; financial habits; education; retirement planning;
Summary/Abstract:The inability to make qualified financial decisions has a very negative impact on peoples’ lives. From this point of view financial literacy represents a basic and inevitable skill that is important for human existence in the 21st century. In many countries, there is a trend towards decreasing state support of individual retirement income, in result of which individuals have to manage their financial resources by themselves in order to secure sustainable retirement and to retain their financial wellbeing standard in the future. Supporting the raise of financial literacy, in particular for young generation, could contribute to better knowledgeability and readiness for household and retirement planning. The authors focus on financial habits and financial behaviour of respondents and their skills in terms of financial literacy concept. This study is aimed at comparison of levels of financial literacy of chosen economic faculties in Slovakia, as well as comparison of levels of financial literacy between the first year undergraduates and those graduates who are in the final year of their studies. The authors statistically process primary data which were collected through a survey in 2015-2016. The data were obtained from economic faculties of three different universities in Slovakia. Correlative data dependence of selected variables and their intensity is analysed using Probit model. The research line is defined by a few hypotheses, and the main goal is to explain the impact of respondents’ financial literacy in terms of their sex, high school background and university study program on financial habits.

Tobacco Tax and Tobacco Consumption in Slovakia

Tobacco Tax and Tobacco Consumption in Slovakia
(Tobacco Tax and Tobacco Consumption in Slovakia)

Author(s):Martin Geško
Language:English
Subject(s):Business Economy / Management, Substance abuse and addiction, Fiscal Politics / Budgeting
Page Range:152-158
No. of Pages:7
Keywords:tobacco tax; economics of tobacco; tobacco policy; demand for cigarettes; elasticity;
Summary/Abstract:Selective consumption taxes and particularly the excise tax on tobacco and tobacco products represent the important source of income for the state budget of the Slovak Republic. In 2016 the tobacco tax revenue amounted to EUR 673.2 million, which represents 6.12% share of the total tax revenues.As the argument for increasing the excise taxes on tobacco products the idea that selective excise taxes have a significant impact on reducing the consumption of the taxed commodities, and thus contribute to mitigating the negative effects associated with their consumption, is widely used. The price sensitivity of the tobacco consumers has been indicated by several scientific papers, mainly from various health organizations. The aim of this paper is to verify whether the development of the excise tax on tobacco and tobacco products in SR indicates the sensitivity of the Slovak tobacco consumers to increased tax rates and prices as well as to determine the factors which could influence their elasticity.

Multiple state models for critical illness policy

Multiple state models for critical illness policy
(Multiple state models for critical illness policy)

Author(s):Lucie Kopecká, Ján Gogola
Language:English
Subject(s):Socio-Economic Research
Page Range:159-164
No. of Pages:6
Keywords:multiple state model; stochastic process; Markov process; critical illness;
Summary/Abstract:The main goal of this paper is to apply multiple state models for an insurance policy combining disability income insurance benefits and critical illness benefits. We consider a policy with term 40 years to a life aged 25 which provides a death benefit, a disability benefit and a critical illness benefit. Using the data supplied by the Continuous Mortality Investigation (CMI) we calculate the premium payable continuously for this policy.

Impact of R&D investments on earnings predictability

Impact of R&D investments on earnings predictability
(Impact of R&D investments on earnings predictability)

Author(s):Barbara Grabińska, Konrad Grabiński
Language:English
Subject(s):Business Economy / Management, Financial Markets, Accounting - Business Administration
Page Range:165-173
No. of Pages:9
Keywords:R&D; earnings predictability; intangible assets; R&D determinants; R&D disclosure;
Summary/Abstract:The aim of this paper is to empirically investigate the impact of R&D investments on earnings predictability. R&D investments are considered to generate one of the most valuable companies’ assets in the era of knowledge economy. This type of investment is however very different from more traditional forms of capital or financial investments. Firstly, R&D projects create more informational asymmetry between a reporting entity and investors. Information about firm’s innovation activities is confidential and expected to be hidden from competitors and as a result disclosure level of R&D intensive firms is supposedly low. Secondly, technological and market outcomes of R&D are usually associated with uncertainty and it is very difficult to determine market success of invented products, innovative services and other research accomplishments. On the basis of these two assumptions, we hypothesize that earnings of R&D intensive firms are less predictable. On the sample of more than 900 firms listed on US stock exchange, we examine the relation between firm’s R&D intensity and earnings predictability, controlling for firm’s profitability, leverage ratio, size and industry affiliation. For measuring the predictability of earnings, we use accounting based metrics proposed by Francis et al. (2006) and Lipe (1990). Earnings predictability is very desirable property of company required by analysts and investors, our findings can have practical implications for estimating cost of capital and valuation of R&D intensive firms.

Financial resources of local government units in respect of the financial perspective of the European Union

Financial resources of local government units in respect of the financial perspective of the European Union
(Financial resources of local government units in respect of the financial perspective of the European Union)

Author(s):Ewa Gubernat
Language:English
Subject(s):Public Administration, Economic history, Economic policy, Transformation Period (1990 - 2010), Present Times (2010 - today), EU-Accession / EU-DEvelopment
Page Range:174-178
No. of Pages:5
Keywords:local government unit; absorption capacity of local government unit;
Summary/Abstract:Finance is the basis for the implementation of public tasks and determines the conditions of local economic development. One of the key issues relevant for local and regional development is the local government unit’s capacity in investment activities. They are the most important category of beneficiaries of EU funds. Based on literature review, I have posed the following research hypothesis: there are four key indicators that determine the absorption capacity of the local government units as a beneficiary of EU funds. I have also analysed the relationship between total budget revenue, budget expenditure, results achieved and debt. I have found that: absorption capacity is closely correlated between the financial condition and the state of local finances, what means that changing in the financial system of local governments units does not affect the absorption capacity and can significantly reduce it. Data were obtained from the GUS Local Data Bank and studies by the Ministry of Finance, as well as data from the National Regional Councils of the Accounting Chamber, covering years 2007-2013.

Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)

Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)
(Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017))

Author(s):Dagmar Halabrinová, Karel Brychta
Language:English
Subject(s):Economic policy, EU-Accession / EU-DEvelopment, Fiscal Politics / Budgeting
Page Range:179-186
No. of Pages:8
Keywords:European Union; harmonization; immovable property; tax rate; VAT;
Summary/Abstract:The aim of the paper is to identify and systematize selected rules contained in the Council Directive 2006/112/ES on the common system of value added tax relating to taxation of immovable property and subsequently, while using cluster analysis, to divide EU Member States into groups according to VAT tax rates applicable. To identify the relevant legal norms contained in the Council Directive 2006/112/ES the legal regulation as valid and effective as to 01 January 2017 was taken into account. To carry out a classification of the EU Member States, the data published by the European Commission was utilized. For the reasons of cluster analysis, five possible VAT objects were taken into consideration (social housing, renovation and repairing, building land, supplies of new buildings and construction work on new buildings). On the basis of results reached one can observe that there is a relatively high variability in the rules established in legal regulations covering issues connected with immovable property. A presumption as to the utilization of exceptions and discretion given to the Member States can be considered as valid. At the same time the results reached prove that Member States can be divided into several groups that demonstrate high similarity in VAT taxation of immovable property.

The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic

The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic
(The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic)

Author(s):Eva Hamplova, Jaroslav Kovarnik
Language:English
Subject(s):National Economy, Business Economy / Management, ICT Information and Communications Technologies
Page Range:187-194
No. of Pages:8
Keywords:business; business environment; E-sales; national economy;
Summary/Abstract:Since 2016 the Czech Republic has gradually been implementing the system of electronic records of sales of goods and services in cash – ´E-sales´ (Czech abbreviation: EET). It is a modern communication means between entrepreneurs and the Financial Administration of the Czech Republic. The objective of this article is to evaluate, with the support of the latest data by the Czech Statistical Office, the influence of the electronic register on the birth and death rate of businesses in the Czech Republic in 2016. The contribution compares the differences between the number of newly-established and closed business units according to their size, the declared legal form of enterprise, and the basic level of nomenclature of economic activities (CZ-NACE) in the years 2010 – 2016. Methods of comparative analysis and analysis of trends are used. At the end of the paper, thanks to the net balance analysis and the average annual growth rate of new businesses analysis, we disprove the hypotheses about the significant impact of the new system introduction on the number of small and medium-sized businesses in the Czech Republic (mainly natural persons and legal entities – limited liability companies), as well as on the number of active business units according to selected economic activities in which the system was started in the first phase.

Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective

Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective
(Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective)

Author(s):Martin Hodula, Stanislav Polouček
Language:English
Subject(s):National Economy, Supranational / Global Economy, Economic policy
Page Range:195-203
No. of Pages:9
Keywords:FAVAR; financial stability; LTD; domestic/foreign currency loans and deposits;
Summary/Abstract:This paper evaluates the relation between the loan-to-deposit ratio (LTD) and financial stability and hence the usefulness of the LTD as a macroprudential policy indicator or instrument. In general, an increase of the LTD should indicate a financial stability decrease. Subsequently we adopt a macroprudential policy perspective and test financial sector stability with respect to the currency (domestic/foreign) in which loans and deposits are denominated. This is done in a linear empirical framework by using large factor-augmented VAR model (FAVAR) which is not limited to number of variables used. For such analysis, it is appropriate to choose an open economy with a bank-based financial system and potential substitutability between domestic and foreign currency loans and deposits. Therefore, we analyze the Czech Republic and Hungary as these countries meet the above listed characteristics. Our results suggest that the structure of financial transactions in terms of domestic/foreign currency denomination cannot be ignored or disregarded in relation to financial stability objective.

Macroeconomic Determinants of Shadow Banking: evidence from Spain

Macroeconomic Determinants of Shadow Banking: evidence from Spain
(Macroeconomic Determinants of Shadow Banking: evidence from Spain)

Author(s):Martin Hodula, Martin Macháček, Ales Melecky
Language:English
Subject(s):National Economy, Supranational / Global Economy, Business Economy / Management
Page Range:204-212
No. of Pages:9
Keywords:shadow banking; credit intermediation; Bayesian ARDL;
Summary/Abstract:Shadow banking is a term that corresponds to credit intermediation outside the regulated banking system. Shadow banking system constitutes over one-quarter of total financial assets in the euro Area. Traditional banks now rely more on short-term funding from other financial intermediaries, which also cover shadow banking entities. Due to this fact they may become more susceptible to runs and liquidity shortages and endanger overall financial stability. Macroprudential authorities should therefore carefully monitor and supervise the growing share of shadow banking activities in the financial system. This paper presents a novel evidence on the shadow banking system dynamics in Spain. We chose Spain as a training sample because of its highly dynamic housing markets and related high securitization of loans. We use different methods to estimate the shadow banking size. We estimate a Bayesian ARDL model to uncover possible determinants of shadow banking system dynamics. Based on preliminary results, we conclude that macroeconomic environment may significantly influence the evolution of shadow banking system.

A Comparative Analysis of Shadow Economy in Croatia and Slovakia

A Comparative Analysis of Shadow Economy in Croatia and Slovakia
(A Comparative Analysis of Shadow Economy in Croatia and Slovakia)

Author(s):Sabina Hodžić, Jana Kockovicova
Language:English
Subject(s):Labor relations, Economic policy, Comparative politics, Fiscal Politics / Budgeting
Page Range:213-221
No. of Pages:9
Keywords:fiscal policy; shadow economy; labour approach; Croatia; Slovakia;
Summary/Abstract:Shadow economy includes all unrecorded economic activities, employment and income. All shadow economy activities are unregulated, untaxed, unregistered and unmeasured by official statistics. Since Croatia and Slovakia are countries in transition, numerous elements exist that support shadow economy in international exchange. Shadow economies in Croatia and Slovakia influence all kinds of economic activities with allocative, stabilizing, welfare and redistributive effects. The objective of this paper is a comparative analysis of shadow economy in Croatia and Slovakia in the period 2005 –2014. The labour approach is used because it relies on the difference between real and registered use of labour. Results show that, in this period, the level of Croatian shadow economy under the labour approach was highest in 2008 (3.65 percent), while in Slovakia it was highest in 2006 (27.47 percent). In order to improve the quality of the fight against corruption and to reduce the level of shadow economy, it is necessary to continue the development of the judiciary, take actions to improve the independence of the judiciary, review the principles of financial support for law enforcement and provide measures to improve their wages.

The changes in capital structure of selected banking markets as a result of new regulations

The changes in capital structure of selected banking markets as a result of new regulations
(The changes in capital structure of selected banking markets as a result of new regulations)

Author(s):Günter Hofbauer, Monika Klimontowicz, Aleksandra Nocoń
Language:English
Subject(s):Business Economy / Management, Financial Markets
Page Range:222-229
No. of Pages:8
Keywords:Basel III; capital regulations; banking market; credit institutions’ liabilities; bank capital; structure of bank capital;
Summary/Abstract:Among many different factors that has influenced banking market for the last few decades the regulations are thought to be the crucial ones. The new prudential standards implemented by the Basel Committee treat banks’ capital as a foundation for safety. The appropriate level of bank’s capital helps to manage all kinds of risks. European directives that have had to be implemented to national regulations have remarkably changed the market environment and influenced banks and credit institutions’ market policy. Fulfilling capital requirements has become one of their most important objectives. On the other hand, capital safety may favour maintaining the stability of banks. The paper presents the review of European regulation in this field and their impact on selected banking market. The author has chosen Germany and Poland as an representation of European largest economies. The purpose of the paper is to present the similarities and differences between the regulation impact on the west and east Europe.

Two Variables Affecting the Economic Value Added (EVA)

Two Variables Affecting the Economic Value Added (EVA)
(Two Variables Affecting the Economic Value Added (EVA))

Author(s):Irena Honková
Language:English
Subject(s):Economic policy, Fiscal Politics / Budgeting
Page Range:230-235
No. of Pages:6
Keywords:Economic value added; EVA; Average weighted cost of capital; WACC; Net operating profit after tax; NOPAT;
Summary/Abstract:Economic value added EVA is one of the most important indicators of financial analysis, however, it has not been being used widely in practice yet. A possible reason is its calculation that is more complicated than for conventional one, e.g. ratios. This complexity primarily involves calculating the average weighted cost of capital (WACC) and unequal approach to the calculation of net operating profit after tax (NOPAT), the WACC and NOPAT are initial variables for the calculation of EVA. The aim of this paper is to summarize the basic approaches to calculating WACC, particularly the cost of equity and to calculate NOPAT and finally to simplify the calculation of EVA with mathematical analogy modifications. Mathematical adjustment has proved that economic value added is essentially a net profit weighted by the debt proportion in the overall capital structure. This post is to submit a simplification of the indicator of economic value added in an effort to extend its application in practice.

The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation

The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation
(The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation)

Author(s):Ján Horvát, Eva Horvátová
Language:English
Subject(s):Business Economy / Management, Financial Markets, Accounting - Business Administration
Page Range:236-242
No. of Pages:7
Keywords:bank assets portfolio; portfolio risk;
Summary/Abstract:In the period of the financial crisis, the current question is how banks should invest, as interest rates and market yields are low, and capital growth is required as a result of bank regulation requirements. Balancing between risk and return in the banking sector is still sustaining and contributing to the pro-cyclical behavior of banks. This article addresses the question whether it is appropriate to undertake a high risk in the banking sector and whether the risk is adequately compensated by adequate returns. It compares the portfolio risk of traditional loans and portfolio of securities eligible for inclusion into the HTM (Held to Maturity) portfolio.

Analysis of the impact of capital structure on business performance

Analysis of the impact of capital structure on business performance
(Analysis of the impact of capital structure on business performance)

Author(s):Jarmila Horvathova, Martina Mokrisova
Language:English
Subject(s):Business Economy / Management, Accounting - Business Administration
Page Range:243-250
No. of Pages:8
Keywords:business performance; capital structure; indicators; model;
Summary/Abstract:The aim of the paper was to analyse the impact of company's capital structure on its performance. To achieve goal, the data of Slovak businesses were used. An input analysis of the capital structure of selected sector was carried out in order to generalize and elaborate conclusions aimed at the capital structure of analysed businesses. Selected indicators of capital structure were calculated to analyse the relationships between these indicators and business performance. The results of the correlation analysis were complemented by examining the impact of selected independent variables on business performance applying regression analysis and principal component analysis. On the basis of the findings, capital structure model was formulated to quantify the impact of changes in capital structure on business performance. The contribution of the paper is the identification of capital structure indicators that affect business performance as well as the construction of capital structure model. The article as well as the research, which is the basis for paper elaboration, is the result of professional public interest focused on the finding whether the capital structure is the determinant of business performance.

Technical Efficiency of Banks Selected countries of Eastern Europe

Technical Efficiency of Banks Selected countries of Eastern Europe
(Technical Efficiency of Banks Selected countries of Eastern Europe)

Author(s):Eva Horvátová
Language:English
Subject(s):Business Economy / Management, Financial Markets
Page Range:251-257
No. of Pages:7
Keywords:technical efficiency of selected banks of Eastern Europe; DEA analysis;
Summary/Abstract:Increased capital requirements are associated with the need to create additional income, with the expansion of banks' performance. The growth of the banking margin can generate downward pressure on prices of resources and the rise in interest rates on loans. Expected growth in the interest margin can be linked to the growth of capital by a certain unit. It should be monitored as to meet the expectations of regulators and how they manifest themselves in countries with different levels of development of the banking sector. In this article we will focus on the efficiency of banks selected countries of Eastern Europe. We will analyze how the technical efficiency of banks is if we consider for their output the net interest margin as presupposes to achieving expectations connected with increasing capital. For these purposes will be used the method of DEA – Data Envelope Analysis.

Assessing the Impact of the Financial Crisis on Global Insurance Regulation

Assessing the Impact of the Financial Crisis on Global Insurance Regulation
(Assessing the Impact of the Financial Crisis on Global Insurance Regulation)

Author(s):Eliška Hrabalová, Eva Vávrová, Lenka Přečková
Language:English
Subject(s):Supranational / Global Economy, Financial Markets, Globalization
Page Range:258-265
No. of Pages:8
Keywords:financial crisis; globalization; insurance market; regulation; authority; contagion channel; trigger;
Summary/Abstract:The aim of this paper is to analyze the impact of the financial crisis on insurance markets in different regions of the global insurance market and to evaluate changes in global approaches to insurance regulation depending on the effects of the financial crisis. The financial crisis has triggered an identified banking crisis and has shifted through the contagion channels from the US mortgage market to other financial sectors and regions of the world. With regard to the integration of financial institutions and the globalization of financial markets, a number of regulatory proposals has emerged in recent years to address the impact of the crisis, to eliminate the trigger of the crisis and to prevent recurrence of the causes of the crisis. This paper builds on the contribution of the authors (Vávrová, Nečas, 2016) published at the international scientific conference European Financial System 2016, whose main objective was to assess the development of financial health of insurers within the global insurance market in the period of lingering financial crisis and to draw conclusions based on the analysis of the insurance sector.

Impact of high frequency trading on volatility in short run and long run

Impact of high frequency trading on volatility in short run and long run
(Impact of high frequency trading on volatility in short run and long run)

Author(s):Juraj Hruška
Language:English
Subject(s):International relations/trade, Methodology and research technology, Financial Markets
Page Range:266-273
No. of Pages:8
Keywords:volatility; high frequency trading; Markov switching model;
Summary/Abstract:Computers have overtaken the most of tasks in intraday trading on modern exchanges. From stock picking to deal timing, optimized algorithms are crucial in trading process. This phenomenon is apparent on the spot as well as on derivative markets. In this paper, we consider the effects of high frequency trading on the short term volatility. The aim of the paper is to investigate the links between high frequency trading (HFT) and spot volatility. High frequency with presence of market microstructure noise and also low frequency data from German stock market are considered. We employ Markov switching models to estimate the relationship of dynamics in stock returns and changes in the activities of high frequency traders. Activity of algorithmic traders is estimated by proxy variables based on the average size of trades. The problem of optimal sampling biases is avoided by incorporating Bundi-Russell (2008) test and test of Lagrangian multipliers. Market microstructure noise can cause biasness in the estimates of the empirical volatility measures and models based on such variables.

The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group

The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group
(The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group)

Author(s):Jana Hvozdenská
Language:English
Subject(s):National Economy, Economic history, Economic policy, Comparative politics, Economic development, Transformation Period (1990 - 2010), Present Times (2010 - today), Financial Markets
Page Range:274-280
No. of Pages:7
Keywords:bonds; slope; spread; yield curve;
Summary/Abstract:The yield curve – specifically the spread between the long term and the short term interest rates is a valuable forecasting tool. It is simple to use and significantly outperforms other financial and macroeconomic indicators in predicting recessions one to six quarters ahead. A rise in the short rate tends to flatten the yield curve as well as to slow down real growth the near term. The relationship between the spread and future GDP activity was proved already before. For better predictions it is good to use other overtaking indicators of economic activity as the development of the stock market. This paper aims to analyze the dependence between the slope of the yield curve, development of the stock market and an economic activity of selected countries between the years 2000 and 2016. The selected countries are the Czech Republic, Hungary, Poland and Slovakia. The natural and probably the most popular measure of economic growth is GDP growth, taken quarterly. We have found out that the bond spreads and stock market development might be used for predicting of the future economic activity, the best lags of bond spreads are 2, 4 or 5 quarters. These findings might be beneficial for investors and provide further evidence of the potential usefulness of the yield curve spreads as indicators of the future economic activity.

Empirical Analysis of Farmers’ Winterkill Risk Perception

Empirical Analysis of Farmers’ Winterkill Risk Perception
(Empirical Analysis of Farmers’ Winterkill Risk Perception)

Author(s):Monika Kaczała
Language:English
Subject(s):Business Economy / Management, Agriculture
Page Range:281-289
No. of Pages:9
Keywords:winterkill; risk perception; risk management; agriculture risk; natural hazard;
Summary/Abstract:Some studies have shown that personal risk perception influences risk attitudes of farmers as well as the type of risk management strategy undertaken. For this reason, identification of the structure of perceived risk and the formation of farmers’ risk perceptions is crucial both for designing a government risk management policy applicable in the agriculture sector and for suppliers of risk management tools as it affects demand for insurance. The aim of this research is to investigate the perception of winterkill risk among Polish farmers, the factors which have an impact on this perception and the impact of acceptable (normal) and catastrophic event on risk perception. Statistical analysis, logit models were applied for analysing the representative poll taken in March 2012 in Poland (750 respondents) with the use of the CATI methodology. Preliminary results show that farmers’ winterkill risk perception is affected mostly by farmer’s loss experience. The structure of answers on risk perception depends also on the nonacceptable loss level.

Negative interest rates – consequence staying in error? (empirical evidence)

Negative interest rates – consequence staying in error? (empirical evidence)
(Negative interest rates – consequence staying in error? (empirical evidence))

Author(s):František Kalouda
Language:English
Subject(s):Business Economy / Management, ICT Information and Communications Technologies
Page Range:290-299
No. of Pages:10
Keywords:banking system; cybernetics; discount rate; negative commercial rate;
Summary/Abstract:The paper is focused to further description and analysis the selected aspects of behavior of Czech banking as a cybernetic system. The objective of the paper is to clarify the implications of central bank regulatory interventions in relations of the managing system (regulator – central bank) to managed system (controlled system – commercial banks) as relationships between operational indicator (discount rate) and regulated indicator (commercial rates).The paper draws on data published by the Czech National Bank (CNB) at http://www.cnb.cz. Methodology of the paper is principally based on the economic cybernetics with special focus to the time series methods and trends analysis. The usual description, literary research, comparison and analytic-synthetic methods are used here as well. The main expected results of the paper relate to the linkages between discount rate and the commercial rate (still not explored), which leads to a discussion of negative commercial rates. Conclusions of the paper partly redefine the position of the central bank in the banking system of the Czech Republic.

Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey

Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey
(Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey)

Author(s):Özcan Karahan, Olcay Çolak
Language:English
Subject(s):National Economy, Economic history, Economic development, Transformation Period (1990 - 2010)
Page Range:300-308
No. of Pages:9
Keywords:Current Account Deficit; Capital Inflows; Growth;
Summary/Abstract:The presence and direction of the relationship between economic growth and current account balance is one of the most fundamental economic matters especially in developing countries. Some economists show that current account deficit arising from increasing import of capital good spurs faster economic growth. Contrarily, some group of researches detect that an increase in the rate of economic growth promotes imports of goods and services, which lead to a deterioration in the current account balance. Some economists also argue that there is a mutual relationship between economic growth and current account balance. This study aims to shed new lights on this controversial issue by examining the Turkish case. Accordingly, using data between 2003 and 2006, we analyse the relationship between economic growth and current account balance financed by capital flows. Empirical findings indicate that there is a bidirectional relationship between economic growth and current account deficit financed by capital inflows. Thus, stability of growth rates in Turkey depend on financing of current account deficit permanently.

The Causal Relationship between Inflation and Interest Rate in Turkey

The Causal Relationship between Inflation and Interest Rate in Turkey
(The Causal Relationship between Inflation and Interest Rate in Turkey)

Author(s):Özcan Karahan, Metehan Yılgör
Language:English
Subject(s):National Economy, Economic history, Transformation Period (1990 - 2010), Present Times (2010 - today), Financial Markets
Page Range:309-316
No. of Pages:8
Keywords:Inflation; Interest Rate;
Summary/Abstract:The causal nexus of inflation and interest rate has a significant role in the application of monetary policy. Indeed, interest rate-inflation nexus is important for policy makers to be effective in selection of the monetary policy aims and tools. However, there is no consensus among the economists about the direction of the causality relationship between inflation and interest rate. Some economists, in the framework of Fisher Hypothesis, argue that there is a positive causal relationship from inflation rate to nominal interest rate. Contrarily, other economists assert that any increase in interest rate accelerates inflation rate by raising the cost-push inflation. This paper aims to examine the relationship between inflation and interest rate in the case of Turkey in order to make a new contribution to the discussions about the direction of causality among the interest rate and inflation. We examine the interest rate-inflation nexus for the term 2002-2016 in Turkey by employing the cointegration and causality tests. The empirical results confirm that there exists a unidirectional causality from inflation to interest rate. From the policy perspective, it can be concluded that to provide price stability is essential for managing interest rate efficiently for Turkish economy.

The role of accounting in regard to information concerning the convergence of airline business models

The role of accounting in regard to information concerning the convergence of airline business models
(The role of accounting in regard to information concerning the convergence of airline business models)

Author(s):Mariusz Karwowski
Language:English
Subject(s):Business Economy / Management, Accounting - Business Administration, Transport / Logistics
Page Range:317-325
No. of Pages:9
Keywords:business model; financial statements; airline industry; full service carrier; low cost carrier;
Summary/Abstract:The objective of the research underlying this article is to present the role of accounting in supplying information relative to the trend toward convergence within the airline industry. The review of publications showed that accounting has only marginal value in providing the requisite data for the analysis of airline business models. The results of the study of the available information derived from financial statements of selected airlines partially confirmed the convergence of airline business models. The contribution of the article to the existing literature lies in its identification of the possible use of accounting in studying the business models of companies operating in the selected industry.

Impact of cost calculation quality on hospital performance

Impact of cost calculation quality on hospital performance
(Impact of cost calculation quality on hospital performance)

Author(s):Magdalena Kludacz-Alessandri
Language:English
Subject(s):Business Economy / Management, Health and medicine and law, Accounting - Business Administration
Page Range:326-332
No. of Pages:7
Keywords:cost accounting; cost calculation; hospital performance; management accounting practices;
Summary/Abstract:Management accounting in hospitals has been an issue of growing interest in the management accounting literature in recent years. Managerial decisions should be based on reliable and credible cost information, whose source should be a correct and efficient cost accounting, since it is the quality of cost information that determines the value and effects of management accounting practices. It is worth adding, that management accounting practices require not only the knowledge about actual operating costs of the hospitals and health services performed by them, but also about their structure and reactions on changes in the range of services, or the number of treated patients. The aim of the article is to make an analysis and evaluation of the cost calculation quality and management accounting practices which are applicable hospitals. The article attempts to verify the hypothesis according to which the quality of cost calculation in hospitals foster the usage of cost information in managerial decisions, and it has a positive influence on the hospital performance. The empirical material was obtained from the analysis of legal Polish and English regulations, and empirical studies conducted in European hospitals. The method of the correlation analysis was utilized to analyze the data. The research confirmed that the quality of patient treatment process calculation has a positive influence on the use of cost information by the hospital’s management, which further influence the hospital’s performance.

Market Concentration and Stability in European Banking

Market Concentration and Stability in European Banking
(Market Concentration and Stability in European Banking)

Author(s):Kristína Kočišová
Language:English
Subject(s):Business Economy / Management, Economic history, Transformation Period (1990 - 2010), Present Times (2010 - today), EU-Accession / EU-DEvelopment, Financial Markets
Page Range:333-341
No. of Pages:9
Keywords:Market concentration; Banking stability; Granger causality test for panel data; European Union countries;
Summary/Abstract:Using aggregate balance sheet data from banking sectors across the European Union (EU) countries over the period from 2004 to 2014 this paper provides empirical evidence on the testing the links between the concentration and stability. The paper contains a theoretical definition of approaches used to test the relation between these two characteristics of the banking sector. We used selected methods to estimate the concentration and stability and to test the presence of concentration-stability or concentration-fragility paradigm in conditions of EU. The stability was estimated with Banking Stability Index (BSI) and Z-score and the market concentration was evaluated with Herfindahl-Hirschman Index (HHI) and Concentration Ratio (CR5). The presence of the paradigm was verified with the test of the Granger causality for panel data. As the result of our analysis, we can say, that in our study the only one-way relationship running from stability to market concentration was estimated.

The Development of Instrument Impact Scenarios with Respect to the Regulatory Policy Model

The Development of Instrument Impact Scenarios with Respect to the Regulatory Policy Model
(The Development of Instrument Impact Scenarios with Respect to the Regulatory Policy Model)

Author(s):Irina Kolupaieva
Language:English
Subject(s):Economic policy, Government/Political systems
Page Range:342-349
No. of Pages:8
Keywords:regulatory policy; government regulation; cognitive model; scenario modelling;
Summary/Abstract:The main purpose of the research is to suggest a cognitive model of factors that influence the regulatory policy and to develop impact scenarios based on the model under question. According to the goal, the algorithm of constructing cognitive models includes relevant stages that have been presented in the paper. The construction of cognitive maps has been based on a certain index-oriented graph (orgraph). The vertex (concepts) of the graph has been studied as components of the three populations. The paper presents a cognitive map of concepts of factors that influence the objectives and leverages of regulatory policy in Ukraine. Based on the research, the level of factors that influence the regulatory policy has been determined. The cognitive map presents all connections between the concepts that are only partly reflected in the given figure. The most active and interacting factors selected have been considered within the scenario modelling. Each of these factor-indicators has been analysed separately.

Correlation analysis between macroeconomic indicators and level of ratings in EU countries

Correlation analysis between macroeconomic indicators and level of ratings in EU countries
(Correlation analysis between macroeconomic indicators and level of ratings in EU countries)

Author(s):Tomasz Kopyściański, Tomasz Rólczyński, Marzena Franków
Language:English
Subject(s):Supranational / Global Economy, Economic policy, Comparative politics, EU-Accession / EU-DEvelopment
Page Range:350-356
No. of Pages:7
Keywords:Ratings and Ratings Agencies; Economic Outlook; synthetic measure; Kendall’s tau correlation coefficient;
Summary/Abstract:Credit rating agencies have a significant impact on the securities market, facilitating investment decisions on the basis of ready-made benchmarks. In this way they contribute to reducing the asymmetries and costs of obtaining information necessary to make decisions regarding buying or selling financial instruments, taking into account the debtor’s estimated risk of default. For many years now credit rating agencies have been an integral part of the financial market, impacting to an even greater degree the functioning conditions of countries, as their dependency on being able to finance their borrowing needs from external sources is continuously growing. Permanent budget deficits and public debt are inherent elements of contemporary public finances. The increased significance of the assessments made by the rating agencies refers closely to the dynamic development of the debt security market and thus emerging demand on the part of the buyers of those securities for an independent analysis, which would determine the issuer’s financial standing. The assessments which are published using special symbols reflect country’s ability to raise capital and its cost. The results of the analysis published in the previous article (Rólczyński, T., Kopyściański, T. (2016). Economic Condition of the European Union Countries and Level of Rating. European Financial Systems 2016, p. 654.), indicate that the ratings provided by the rating agencies are linked to the countries’ economic condition.

Selected aspects of financial literacy of seniors in Slovakia

Selected aspects of financial literacy of seniors in Slovakia
(Selected aspects of financial literacy of seniors in Slovakia)

Author(s):Jaroslav Korečko, Ján Vravec
Language:English
Subject(s):Adult Education, Socio-Economic Research
Page Range:357-365
No. of Pages:9
Keywords:Financial literacy of seniors; financial education; seniors;
Summary/Abstract:The article analyses selected aspects of financial literacy of seniors in Slovakia. Financial literacy is a system of knowledge, skills and experience for effective management of personal financial resources and assets. The nature of financial literacy is to efficiently ensure adequate financial resources and effective asset management. Financial literacy is not a definitive state, but it must evolve and improve over time, and it also applies to a higher age. Knowledge, skills and experience are often conditioned by variable aspects such as age, education, personality, general outlook, culture or intuition. Pensioners with a low level of financial literacy, without basic financial knowledge and skills, cannot make good financial decisions and manage crisis financial situations. As a result of the low level of financial literacy are serious financial and property problems of many senior citizens, which are causing serious problems and crisis phenomena in the economy and across society.

Research of Public Financing Efficiency of Social Well-being in the Russian Federations’ Regions

Research of Public Financing Efficiency of Social Well-being in the Russian Federations’ Regions
(Research of Public Financing Efficiency of Social Well-being in the Russian Federations’ Regions)

Author(s):Dmitrii Kornilov, Nadezhda Yashina, Natalia N. PRONCHATOVA-RUBTSOVA, Oksana Kashina
Language:English
Subject(s):Regional Geography, Economic policy, Public Finances
Page Range:366-374
No. of Pages:9
Keywords:social well-being; public financing efficiency; investing in human capital; consolidated standardized indicator; rating;
Summary/Abstract:In the knowledge-based economy, the main objective of public finance management is becoming the social well-being maximization that is achieved through the implementation of effective financial policy. It is based on the optimal structural distribution of financial resources between the industrial and non-productive sectors, combined with innovative techniques in public financial management. This policy is directed to well-being growth of the population and investing in human capital. So, the aim of the paper is to research the public financing efficiency of social well-being in the Russian Federations’ regions. Author's technique has been developed for determining a consolidated standardized indicator, which assesses the social well-being level of territories. It is based on a specially formed system of indicators. A qualitative social well-being condition of the population is proposed to be quantified by a number of indicators included in the assessment criteria system. It consists of two indicators’ groups: indicators of investing in human capital (health care, education, social protection, spiritual wealth), as a fundamental value of the modern society and indicators of financial provision in the spheres which determine social well-being. The methods of economic, system analysis and mathematical statistics are used in this research. Approbation of proposed technique is carried out on official statistical data for 2015 from open databases of the Federal State Statistics Service and the Federal Treasury of the Russian Federation. As a result, the rating of the regions is constructed on the basis of the developed technique for assessment of social well-being financing efficiency.

The impact of barriers in the access to financial products and services on the financial exclusion of the generation 50+ in Poland

The impact of barriers in the access to financial products and services on the financial exclusion of the generation 50+ in Poland
(The impact of barriers in the access to financial products and services on the financial exclusion of the generation 50+ in Poland)

Author(s):Anna Korzeniowska, Wojciech Misterek
Language:English
Subject(s):Gerontology, Financial Markets, Socio-Economic Research
Page Range:375-383
No. of Pages:9
Keywords:financial exclusion; usage of financial products; personal finance;
Summary/Abstract:Financial exclusion is defined by the European Committee as a situation in which a person encounters difficulties in both access to as well as the usage of financial products and services at the level required to meet his/her needs. The idea beyond is also to enable them to lead a normal social life. It is necessary to point out that the access to financial products is understood as a possibility to use them under reasonable economic conditions. Among those most endangered by financial exclusion are, inter alia, elderly people because their reluctance to accept new technologies and opportunities provided by financial markets is much bigger than that one of younger generations. There is much evidence for that statement, some of it being the ratio of underbanked elderly people which in Poland for the aged 55-64 and over 65 is 32% and 57% respectively, with the average for the whole country population - approx. 23%. The question arises as for the reasons for such a situation and that is why the aim of this paper is to analyse the existence of barriers in the access to financial products and to verify their influence on the diagnosed higher level of financial exclusion of the generation 50+. To analyse the factors influencing behaviours of senior citizens on the financial markets, the research in the form of questionnaire sent to the group of approx. 380 citizens of the Lublin region in Poland was conducted. The results indicate that, while cooperating with financial institution, elderly people are aware of the barriers they meet such as modern technology, a professional and incomprehensible language, extensive or scarce range of banking services ,etc.

The Brief Analysis of the Foreign Trade of the Czech Republic in International Comparison

The Brief Analysis of the Foreign Trade of the Czech Republic in International Comparison
(The Brief Analysis of the Foreign Trade of the Czech Republic in International Comparison)

Author(s):Jaroslav Kovarnik, Eva Hamplova
Language:English
Subject(s):National Economy, Economic policy, International relations/trade, Economic development
Page Range:384-392
No. of Pages:9
Keywords:Central Europe; Czech Republic; export; foreign trade; import;
Summary/Abstract:The Czech Republic is the country in the Central Europe, it is a member of different international organizations, such as the European Union or Visegrad Four. This country has strong relations with other member states of V4 (namely Poland, Slovakia, and Hungary), where Poland and Slovakia are neighbours of the Czech Republic as well, however, it has the strongest economic relations with other neighbour, namely Germany. As was already mentioned, the Czech Republic, Slovakia, Poland, and Hungary are members of Visegrad Four, and share similar history, geo-political ideas, and economic development. This article deals with the analysis of foreign trade development since 2000, because foreign trade is crucial for sustainable development for almost all countries around the world (it is part of GDP formula in open economy). The aim of this article is to analyse selected aspects of foreign trade in the Czech Republic in comparison with above mentioned countries. The analysis focuses on the development of foreign trade with goods and with services, where have been relatively surprising results (the weakest economy in terms of services has been Germany), but consequently the article analyses relations of the Czech Republic with all other analysed countries. The analysis shows surprising development again, where net balance with these countries has been growing despite the fact that GDP in these countries decreased. Detail description of results is in this article.

Determinants for the development of supplementary pension schemes

Determinants for the development of supplementary pension schemes
(Determinants for the development of supplementary pension schemes)

Author(s):Patrycja Kowalczyk-Rólczyńska, Tomasz Rólczyński
Language:English
Subject(s):Labor relations, Socio-Economic Research
Page Range:393-401
No. of Pages:9
Keywords:pension schemes; pension insurance; correlation analysis; factor analysis;
Summary/Abstract:The accumulation of voluntary pension savings by households is a vital element of not only the household’s finances, but also of the social security system. Being informed of the factors which are conducive to the accumulation of capital for oldage security is not only crucial for entities offering various pension insurance contracts, but also for the state, which often supports the development of these contracts. The aim of the article is to identify and evaluate the impact of the factors determining the development of the additional forms of pension provision. In the study, correlation analysis and factor analysis were employed to assess the influence of the selected factors (economic and demographic) on the development of some of the pension insurance contracts. The study’s findings show clearly that the increasing life expectancy and the level of the household’s income are important determinants in terms of the development of voluntary pension insurance contracts.

New trends in banking sector

New trends in banking sector
(New trends in banking sector)

Author(s):Jan Krajíček
Language:English
Subject(s):Business Economy / Management, Economic policy
Page Range:402-407
No. of Pages:6
Keywords:Bank; deposits; revenue; liabilities; profit;
Summary/Abstract:The aim of this paper is to analyze the policy of banks in relation to their clients. Long-term systematic increase in deposits and a decline in interest rates in the economy bring new problems and questions how to cope with the increase. With the increase is linked to the management of assets and liabilities. It plays an important role and expected developments in key interest rates. The paper mainly deals with the impact of interbank PRIBOR 3M, which is considered crucial interest rate. Banks derive mainly from the interest rate loans to clients. Deposit growth not only in the banking sector, and has their subsequent rebound in banking policy and the creation of new banking products, with consequent impacts on the economy of the bank. Impacts vary according to the size of banks and their client segmentation. The basis is literature review, which is connected to the analytical part (using modeling Gretl), using data available in the system ARAD (Czech National Bank).In conclusion, it is assessed recent developments, future outlook and anticipated impacts of the financial sector.

Possibility of Accrual Accounting Application in Case of Active Reserve Forces of the Czech Army

Possibility of Accrual Accounting Application in Case of Active Reserve Forces of the Czech Army
(Possibility of Accrual Accounting Application in Case of Active Reserve Forces of the Czech Army)

Author(s):Miroslav Krč, Vladimír Golik, Aleš Olejníček, Vladan Holcner
Language:English
Subject(s):Military policy, Accounting - Business Administration
Page Range:408-416
No. of Pages:9
Keywords:accrual accounting; active reserve forces; cost centre; analytical accounts; synthetics accounts;
Summary/Abstract:The article „Possibility of Accrual Accounting Application in case of Active Reserve Forces of the Czech Army” analyses the application of the accrual accounting by way of Active Reserve Forces example. Accrual accounting is considered as a potential tool of resource management system effectiveness increase in the Czech Army. The Active Reserve Force is monitored as a cost centre that is managed by actual and predetermined costs. The three training situation are simulated. The analysis takes into account only activities directly connected with training of the Active Reserve unit influenced by training type and military vehicles involvement. The data are displayed by synthetic and analytical accounts. The training price of separate Active Reserve soldiers is generated through the synthetic and subsidiary accounts under accrual accounting system. Each Active Reserve serviceman have assigned own analytical cost account. This account have displayed all cost items associated with his training. The closing balance of all analytical accounts provides the sum of total costs that were connected with Active Reserve member training.

Mergers of agricultural enterprises in the Czech Republic

Mergers of agricultural enterprises in the Czech Republic
(Mergers of agricultural enterprises in the Czech Republic)

Author(s):Michaela Krejčová, Jana Gláserová, Milena Otavová, Sabina Mašová
Language:English
Subject(s):Business Economy / Management, Agriculture
Page Range:417-425
No. of Pages:9
Keywords:mergers; company transformation; agriculture; efficiency;
Summary/Abstract:One of the conspicuous manifestations of the globalization of economic activities is mutual operations between enterprises whose aim is to achieve a higher valuation of them. These are transformations of companies and cooperatives whose use is steadily rising among businesses. Mergers occur throughout the entire economy, including agriculture. Agriculture is an important component of the economy although its share of gross domestic product shows a decreasing trend. In agriculture, the most common motivation for mergers is the simplification of the structure of a group of companies, as suggested by the study of merger projects. To evaluate the success and efficiency of mergers selected ratios are used and the measured period is three years before and three years after the merger. The study involves agricultural enterprises in the Czech Republic that were merged in the years 2010 – 2012. Also, a relationship between the number of transformations in the form of mergers in agriculture and the development of GDP in the years 2006 – 2016 is examined.

Reporting of Goodwill in Mergers & Acquisitions

Reporting of Goodwill in Mergers & Acquisitions
(Reporting of Goodwill in Mergers & Acquisitions)

Author(s):Zuzana Křížová
Language:English
Subject(s):Business Economy / Management, Accounting - Business Administration
Page Range:426-431
No. of Pages:6
Keywords:goodwill; intangible assets; mergers and acquisitions; reporting;
Summary/Abstract:In the new economy, intangible assets have become the main value creators for a large number of companies and economic sector. Recent growth of the service sector and of the information technology-related business, along with the dramatic increase in the number and size of mergers and acquisitions, has made accounting for intangible assets very significant, especially in the field of reporting of goodwill. Comparative analysis is focused on the differences between IFRS, US GAAP accounting procedures and Czech accounting legislation. Main areas of analysis and synthesis are the identification of mehods for goodwill recognition and reporting. The result is to recommend more broadly voluntary disclosure in the reported financial statements of companies. Data disclosed and published on a voluntary basis are.

Analysis of Insurance Distribution on the Czech Insurance Market

Analysis of Insurance Distribution on the Czech Insurance Market
(Analysis of Insurance Distribution on the Czech Insurance Market)

Author(s):Martina Krügerová
Language:English
Subject(s):Law on Economics, Financial Markets, EU-Legislation, Comparative Law
Page Range:432-440
No. of Pages:9
Keywords:distribution of insurance; insurance intermediaries; insurance markets regulations;
Summary/Abstract:In the insurance market, either internal or external sales method can be selected to distribute an insurance coverage. The external distribution channel (also called the intermediary channel) is represented by insurance intermediaries; the internal distribution channel (also called the employee channel) by employees of insurance companies. The new/forthcoming regulation of insurance distribution brings several changes, and alters a number of important fundamentals of the regulation of insurance distribution, in consequence insurance intermediaries, too. One of the goals of a comprehensive amendment, the introduction of a new categorization of insurance intermediaries and removal of differences in the external and internal distribution of insurance. This article is focused on the analysis of insurance distribution aiming insurance intermediaries in the context of insurance market development as well as the changes in regulation of insurance distribution as it comes to both the Czech and European law. The aim is to analyze the groups with the impact of the new regulation.

The Governmental Policy of Budget Balancing in Ukraine

The Governmental Policy of Budget Balancing in Ukraine
(The Governmental Policy of Budget Balancing in Ukraine)

Author(s):Petro Krush, Dmytro Mastiuk, Petr Valouch
Language:English
Subject(s):National Economy, Economic policy, Government/Political systems, Fiscal Politics / Budgeting
Page Range:441-449
No. of Pages:9
Keywords:Budget; state finance; state policy; Budget deficit; state debt;
Summary/Abstract:The main aim of the paper is to identify distinctive features of the state Budget balancing policy realization, to define the internal and external factors that influence the State’s Finance and to determine sources of the supplement and balancing of the Ukrainian State Budget. As the result, the paper provides crucial contradictions of the state policy implementation of the State Budget balancing in Ukraine. In the article, we group main influential factors, depends on the nature of the influence (external and internal), that define the negative state and misbalance the Ukrainian Budget. Herein, we offer the scientific approach for Ukrainian Budget’s replenishment and balancing with main accent on activation of the internally related financial potential sources. Introduced approach will ensure the equalization of the expenditures and income, which will set up the basis for a long-term stable growth and resolving of the socio-economic issues. The results of the research are very important and can be applied for the anti-crisis plan development in order to ensure the additional incomes to the State Budget using the potential financial sources accumulation, as the basis for effective long-term execution of the Ukrainian state policy of the Budget Balancing.

IPO Non-Financial Factors Influencing the Investors Decisions

IPO Non-Financial Factors Influencing the Investors Decisions
(IPO Non-Financial Factors Influencing the Investors Decisions)

Author(s):Andrea Krýslová
Language:English
Subject(s):Business Economy / Management, Governance, Accounting - Business Administration
Page Range:450-457
No. of Pages:8
Keywords:Corporate Governance; investor decisions; IPO; non-financial factors;
Summary/Abstract:This article describes the impact of non-financial factors on investor decisionmaking. The range of economic capital needs a funding system that is tailored to the requirements of the new context. The IPO decision is an essential strategic decision that needs to be seen from several angles of view. This article brings new point of view through non-financial factors. The entry into the stock exchange establishes the relationship between the company and a number of institutional and minor shareholders and here is the time to consider meaning of non-financial factors. The relationship between companies and investors need to be solve with the appropriate sense and knowledge about factors, that play the key role in the investors decisions. With the everincreasing range of global investment opportunities, companies need to focus on building long-term investor relations based on trust and regular communication. Non-financial factors are thus one of the central points of this demanding process. High standards of the company and its quality management will significantly contribute to its long-term performance. The goal of the article is to confirm, that companies that develop their skills in non-financial areas, such as value creation, management enhancement, environmental care, and those who can demonstrate their performance through comprehensive reporting, will be much more attractive to investors than companies that are currently learning or have not yet done so. This article is focused in detail on the factors that influence investor decision-making and its inference is, that impeccable analysis of nonfinancial factors and its proper implementation can move company into the next successful phase of building its financial future.

Some Considerations on the Green Bonds Market Development

Some Considerations on the Green Bonds Market Development
(Some Considerations on the Green Bonds Market Development)

Author(s):Anetta Kuna-Marszałek, Jakub Marszałek
Language:English
Subject(s):Business Economy / Management, Energy and Environmental Studies, Physical Geopgraphy, Human Ecology
Page Range:458-465
No. of Pages:8
Keywords:green bonds; eco-investments; global market; climate change; ecology;
Summary/Abstract:The article discusses current trends in the global bond market. Particular attention was paid to green bonds. The purpose of the article is to identify the conditions for green bonds issues in the context of changes in the environment and financial market conditions. More than 600 issues of such securities throughout the world were analyzed over the years 2010-2016. The analysis included the issuer's nationality structure, bond’s maturity and yield to maturity, the currency the bonds were denominated in and bond’s risk assessment. We also analyzed changes in NOx and greenhouse gas emissions (GHG) and energy consumption. Data were obtained from the World Bank and Thomson Reuters’s Eikon databases. Statistical study was supplemented with literature studies of green bonds reports. Using descriptive statistics analysis (arithmetic mean, median, standard deviation) and significance test of differences it has been shown that green bonds are primarily used to finance investments in highly developed countries. This means that their direct impact on the environment is difficult to be identified. Beneficiaries are mainly companies developing new technologies. In turn, issues from poorer regions are also targeted to the developed capital markets to reduce the cost of financing. This means that the “green nature” of these bonds is highly debated, and the environmental aspect seems to be only a lure for investors.

The dynamic relationship between aggregate fund flows and share market returns: Empirical evidence from BRIC

The dynamic relationship between aggregate fund flows and share market returns: Empirical evidence from BRIC
(The dynamic relationship between aggregate fund flows and share market returns: Empirical evidence from BRIC)

Author(s):Oleksandra Lemeshko
Language:English
Subject(s):National Economy, Economic history, Transformation Period (1990 - 2010), Present Times (2010 - today), Financial Markets
Page Range:466-474
No. of Pages:9
Keywords:equity fund flows; excess share market returns; Granger-causality; BRIC;
Summary/Abstract:Already for more than twenty years investigation of dynamic relationship between aggregate fund flows and share returns represents considerable interest for both practitioners and academicians. The former may use such investigation as useful aid for volatility timing for their investment portfolios; the latter may use such evidence as a proof of efficient market hypothesis violation, which, if found, will have far-reaching implications for the theory of finance. In this paper we aim to investigate the dynamic bidirectional interaction between aggregate fund flows and excess share market returns in a group of emerging BRIC economies. Particularly, we investigate the possibility of a causality mechanism through which aggregate domestic equity fund flows may affect local excess share market returns and vice versa in short-term and long-term period by means of Engle-Granger causality test and VECM.

Environmental insurance in Poland – The notion, scope and legal determinants

Environmental insurance in Poland – The notion, scope and legal determinants
(Environmental insurance in Poland – The notion, scope and legal determinants)

Author(s):Malwina Lemkowska
Language:English
Subject(s):Energy and Environmental Studies, Civil Law, Environmental and Energy policy
Page Range:475-483
No. of Pages:9
Keywords:environmental insurance; environmental law; polish insurance market;
Summary/Abstract:The potential insuring parties in Poland have recently started to identify the environmental risk. The environmental insurance products are relatively new as the part of insurers’ offer. The article refers to the legal determinants of environmental insurance market’s development. Firstly the author will explicate the term “environmental insurance” (taking into account Polish and international conditions as the background of analyses) and secondly, explain the influence, that the Polish insurance and environmental legal system have on the development of the market. The main purpose of the researcher is to answer two research questions: what attributes the insurance products qualified in Poland to the category “environmental insurance” have and how the structure of Polish legal system determines their scope. Preliminary results of the research indicate that all environmental insurance products can be divided into three groups (liability, property and personal environmental insurance). The identification and assessment of the environmental risk during the underwriting process are the criteria, which cause that the insurance product is classified as an environmental one. There are only few offers of stand-alone environmental liability products in Poland. Besides, there are environmental clauses in some general civil liability insurance. We expect the development of property and personal environmental insurance in future. They are predicted to fill the gaps in the liability regime. The regime of both administrative and civil liability law is enough to determine the scope of environmental liability insurance products. The property and personal insurance are influenced by the legal scope of freedom of contracting (as defined in Polish civil code), the definition of property and personal interests, which (according to law) can be the subject of insurance and the boarders created by the insurance classification (the list of non-life and life insurance classes).

What drives agricultural commodities prices? Mixed-frequency analysis of the agricultural market drivers

What drives agricultural commodities prices? Mixed-frequency analysis of the agricultural market drivers
(What drives agricultural commodities prices? Mixed-frequency analysis of the agricultural market drivers)

Author(s):Matěj Liberda
Language:English
Subject(s):Business Economy / Management, Agriculture, Financial Markets, Accounting - Business Administration
Page Range:484-491
No. of Pages:8
Keywords:agricultural commodities; mixed-data sampling; market drivers; financialization;
Summary/Abstract:The importance of agricultural commodities markets is growing and their dynamics have changed substantially recently, especially in the period after the financial crisis of 2008. The aim of the paper is to explain agricultural commodities price movements by assessing an impact of multiple economic and financial factors. We study 6 agricultural commodities, 3 representatives of the grain market and 3 soft commodities, in a time span of 20 years ranging from 01/01/1997 to 31/12/2016. We identify 9 macroeconomic and financial drivers. The data are collected from Bloomberg. We use mixed-data-sampling methodology that enables us to study drivers of various frequencies (daily, weekly and monthly) simultaneously in a single linear model. We do not find a link between energy market and agricultural commodities markets suggested by previous papers and thus we conclude that the link is not linear. In addition, results show prevailing impact of the financial variables over the impact of the macroeconomic factors, which is in line with the hypothesis of the commodity market financialization. We also break down the studied period into two fractions divided by the 2008 crisis and we find that the financialization occurred after the crisis of 2008.

Effect of zero lower bound on large firms financing in the Czech Republic

Effect of zero lower bound on large firms financing in the Czech Republic
(Effect of zero lower bound on large firms financing in the Czech Republic)

Author(s):Dagmar Linnertová, Veronika Kajurová
Language:English
Subject(s):Business Economy / Management, Economic policy
Page Range:492-497
No. of Pages:6
Keywords:monetary policy; interest rate; transmission mechanism; balance sheet channel;
Summary/Abstract:The effect of monetary policy might be analyzed using several channels. One of these channels is known as the balance sheet channel and shows how monetary policy affects the credit portfolio of financial intermediaries as well as other economic agents. For instance, a contractionary monetary policy would affect banks’ ability to grant loans, leading to credit rationing. This has implications for credit availability to borrowers, especially small-scale borrowers with less sophistication and collateral to back-up their loan demand. Most of the current studies aiming to analyze the balance sheet channel during the monetary tighten period. The purpose of our study is to investigate the changes in financial structure of Czech blue chips traded in the PSE during the period of zero lower bound. Firm-level financial data for Czech firms are gathered from Bloomberg terminal and Amadeus database and panel regression is employed to determinant how financing indicators react to monetary policy changes.

Assessment of Impact of Items Reducing Tax Base and Tax on Total Amount of Corporate Income Tax in the Czech Republic in Selected Periods

Assessment of Impact of Items Reducing Tax Base and Tax on Total Amount of Corporate Income Tax in the Czech Republic in Selected Periods
(Assessment of Impact of Items Reducing Tax Base and Tax on Total Amount of Corporate Income Tax in the Czech Republic in Selected Periods)

Author(s):Karolina Lisztwanová, Iveta Ratmanová
Language:English
Subject(s):Economic history, Economic policy, Transformation Period (1990 - 2010), Present Times (2010 - today), Fiscal Politics / Budgeting
Page Range:498-505
No. of Pages:8
Keywords:corporate income tax; tax base; tax savings; pyramidal decomposition; functional method;
Summary/Abstract:A tax policy as an important part of a fiscal policy influences many financial and operational decisions of enterprises. Regarding a corporate income tax, the aim of this paper is to state a value of tax savings with respect selected items reducing a tax base and with respect tax credits as items decreasing enterprises` a final tax liability. It means that attention is devoted the first of all to impact of tax losses, research and development expenses, expenses connected with donation activities of companies and investment incentives. As a source data are used data provided by Ministry of Finance of the Czech Republic connected with a selected period between years 2005 and 2015. We concentrate our attention not only on total summarized data but moreover on selected sectors. To be able to express and to compare changing of above-mentioned items, we firstly use base and chain indexes. Moreover, a method of a pyramidal decomposition of a top indicator i.e. the final tax liability is used, so that we could calculate and find out an impact of selected items on this value. In case of identified multiplicative relationship among individual items, a functional method is applied. Regarding results of our research, we may confirm that impact of above mentioned items changes in a selected period and especially in case of tax losses, we can identify a significant influence in determining of a final tax liability. Respecting research and development expenses, we may state that their impact grows up in observed period. When it comes investment incentives and donation activities development of these items is stable growing.

Brexit Implications on the Czech Republic via GNI Based Contributions to the EU Budget

Brexit Implications on the Czech Republic via GNI Based Contributions to the EU Budget
(Brexit Implications on the Czech Republic via GNI Based Contributions to the EU Budget)

Author(s):Dušan Litva
Language:English
Subject(s):Economic policy, EU-Accession / EU-DEvelopment
Page Range:506-512
No. of Pages:7
Keywords:Brexit; Czech Republic; European Union; GNI; contribution; budget; gap;
Summary/Abstract:After activation of Article 50 on 29th March 2017 Brexit will become reality within next 2 years with all its consequences and implications. UK was significant contributor to the EU budget with its net contribution of 11,2 billion Euro in 2015. Leaving EU will hence significantly reduced incomes to the EU budget. There are several options how to close this gap- increase contribution per each member state, decrease receipts per each country, define new revenue streams to the EU budget or simply reduce overall costs. Czech Republic is clearly net receiver of EU funds with its net positive position of 5,6 billion Euro in 2015. As Czech Republic is more receiving than contributing, choice of solution how to close Brexit gap will influence its current net position. Paper is studying all theoretical options and their impact on Czech Republic. Losses in net balance of Czech Republic due to Brexit might be in year 2020 from 0,2 to 0,9 bil. Euro according to different scenarios to close UK contribution gap. Relates study of OST EU estimated worsening of cumulative net position of Czech Republic due to Brexit vote till 2020 from 0,8 bil. Euro to 2,1 bil. Euro.

European Financial Systems 2017 - Proceedings of the 14th International Scientific Conference (Part 1) European Financial Systems 2017 - Proceedings of the 14th International Scientific Conference (Part 1)

The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies

The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies (The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies)

The Development of Gross Premiums Written in Life Insurance in the Czech Republic

The Development of Gross Premiums Written in Life Insurance in the Czech Republic (The Development of Gross Premiums Written in Life Insurance in the Czech Republic)

Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices

Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices (Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices)

Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach

Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach (Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach)

Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies

Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies (Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies)

Factors that affect the market prices of flat renting

Factors that affect the market prices of flat renting (Factors that affect the market prices of flat renting)

The effect of premium framing on life insurance demand

The effect of premium framing on life insurance demand (The effect of premium framing on life insurance demand)

Application of selected financial performance methods to chosen industry in the Czech Republic

Application of selected financial performance methods to chosen industry in the Czech Republic (Application of selected financial performance methods to chosen industry in the Czech Republic)

Causes of the Foreclosure Crisis – Irrational or Rational Decisions?

Causes of the Foreclosure Crisis – Irrational or Rational Decisions? (Causes of the Foreclosure Crisis – Irrational or Rational Decisions?)

The dynamics of linkages between European currencies: How does it change according to the time of day?

The dynamics of linkages between European currencies: How does it change according to the time of day? (The dynamics of linkages between European currencies: How does it change according to the time of day?)

Closet Indexing in Czechia: An Extended Analysis

Closet Indexing in Czechia: An Extended Analysis (Closet Indexing in Czechia: An Extended Analysis)

Implementation of cost model for effective planning of foreign military operations

Implementation of cost model for effective planning of foreign military operations (Implementation of cost model for effective planning of foreign military operations)

Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States

Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States (Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States)

Regulation of Insurance Market in Slovak republic

Regulation of Insurance Market in Slovak republic (Regulation of Insurance Market in Slovak republic)

To gamble or not to gamble – comparison of decisions made under risk and under uncertainty

To gamble or not to gamble – comparison of decisions made under risk and under uncertainty (To gamble or not to gamble – comparison of decisions made under risk and under uncertainty)

Comparison of the tax burden on natural persons in the Slovak Republic and Spain

Comparison of the tax burden on natural persons in the Slovak Republic and Spain (Comparison of the tax burden on natural persons in the Slovak Republic and Spain)

Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia

Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia (Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia)

Tobacco Tax and Tobacco Consumption in Slovakia

Tobacco Tax and Tobacco Consumption in Slovakia (Tobacco Tax and Tobacco Consumption in Slovakia)

Multiple state models for critical illness policy

Multiple state models for critical illness policy (Multiple state models for critical illness policy)

Impact of R&D investments on earnings predictability

Impact of R&D investments on earnings predictability (Impact of R&D investments on earnings predictability)

Financial resources of local government units in respect of the financial perspective of the European Union

Financial resources of local government units in respect of the financial perspective of the European Union (Financial resources of local government units in respect of the financial perspective of the European Union)

Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)

Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017) (Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017))

The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic

The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic (The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic)

Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective

Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective (Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective)

Macroeconomic Determinants of Shadow Banking: evidence from Spain

Macroeconomic Determinants of Shadow Banking: evidence from Spain (Macroeconomic Determinants of Shadow Banking: evidence from Spain)

A Comparative Analysis of Shadow Economy in Croatia and Slovakia

A Comparative Analysis of Shadow Economy in Croatia and Slovakia (A Comparative Analysis of Shadow Economy in Croatia and Slovakia)

The changes in capital structure of selected banking markets as a result of new regulations

The changes in capital structure of selected banking markets as a result of new regulations (The changes in capital structure of selected banking markets as a result of new regulations)

Two Variables Affecting the Economic Value Added (EVA)

Two Variables Affecting the Economic Value Added (EVA) (Two Variables Affecting the Economic Value Added (EVA))

The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation

The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation (The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation)

Analysis of the impact of capital structure on business performance

Analysis of the impact of capital structure on business performance (Analysis of the impact of capital structure on business performance)

Technical Efficiency of Banks Selected countries of Eastern Europe

Technical Efficiency of Banks Selected countries of Eastern Europe (Technical Efficiency of Banks Selected countries of Eastern Europe)

Assessing the Impact of the Financial Crisis on Global Insurance Regulation

Assessing the Impact of the Financial Crisis on Global Insurance Regulation (Assessing the Impact of the Financial Crisis on Global Insurance Regulation)

Impact of high frequency trading on volatility in short run and long run

Impact of high frequency trading on volatility in short run and long run (Impact of high frequency trading on volatility in short run and long run)

The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group

The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group (The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group)

Empirical Analysis of Farmers’ Winterkill Risk Perception

Empirical Analysis of Farmers’ Winterkill Risk Perception (Empirical Analysis of Farmers’ Winterkill Risk Perception)

Negative interest rates – consequence staying in error? (empirical evidence)

Negative interest rates – consequence staying in error? (empirical evidence) (Negative interest rates – consequence staying in error? (empirical evidence))

Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey

Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey (Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey)

The Causal Relationship between Inflation and Interest Rate in Turkey

The Causal Relationship between Inflation and Interest Rate in Turkey (The Causal Relationship between Inflation and Interest Rate in Turkey)

The role of accounting in regard to information concerning the convergence of airline business models

The role of accounting in regard to information concerning the convergence of airline business models (The role of accounting in regard to information concerning the convergence of airline business models)

Impact of cost calculation quality on hospital performance

European Financial Systems 2017 - Proceedings of the 14th International Scientific Conference (Part 1)
European Financial Systems 2017 - Proceedings of the 14th International Scientific Conference (Part 1)

The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies
(The impact of financial market imperfections on the investment – cash flow sensitivity in Slovak companies)

The Development of Gross Premiums Written in Life Insurance in the Czech Republic
(The Development of Gross Premiums Written in Life Insurance in the Czech Republic)

Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices
(Volatility and Correlations in Stock Markets: The case of US S&P 500, Japan Nikkei 225 and DAX indices)

Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach
(Linkages between Brexit and European Equity Markets Evidence from Quantile Regression Approach)

Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies
(Bankruptcy Model IN05 and Private Slovak Civil Engineering Companies)

Factors that affect the market prices of flat renting
(Factors that affect the market prices of flat renting)

The effect of premium framing on life insurance demand
(The effect of premium framing on life insurance demand)

Application of selected financial performance methods to chosen industry in the Czech Republic
(Application of selected financial performance methods to chosen industry in the Czech Republic)

Causes of the Foreclosure Crisis – Irrational or Rational Decisions?
(Causes of the Foreclosure Crisis – Irrational or Rational Decisions?)

The dynamics of linkages between European currencies: How does it change according to the time of day?
(The dynamics of linkages between European currencies: How does it change according to the time of day?)

Closet Indexing in Czechia: An Extended Analysis
(Closet Indexing in Czechia: An Extended Analysis)

Implementation of cost model for effective planning of foreign military operations
(Implementation of cost model for effective planning of foreign military operations)

Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States
(Allocation of environmental taxes in the context of general government expenditures on environmental protection in the European Union Member States)

Regulation of Insurance Market in Slovak republic
(Regulation of Insurance Market in Slovak republic)

To gamble or not to gamble – comparison of decisions made under risk and under uncertainty
(To gamble or not to gamble – comparison of decisions made under risk and under uncertainty)

Comparison of the tax burden on natural persons in the Slovak Republic and Spain
(Comparison of the tax burden on natural persons in the Slovak Republic and Spain)

Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia
(Comparison of Selected Aspects of Financial Literacy and their Differences in the Conditions of University Education in Slovakia)

Tobacco Tax and Tobacco Consumption in Slovakia
(Tobacco Tax and Tobacco Consumption in Slovakia)

Multiple state models for critical illness policy
(Multiple state models for critical illness policy)

Impact of R&D investments on earnings predictability
(Impact of R&D investments on earnings predictability)

Financial resources of local government units in respect of the financial perspective of the European Union
(Financial resources of local government units in respect of the financial perspective of the European Union)

Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017)
(Taxonomy of EU Member States from the View of VAT Imposed on Immovable Property (year 2017))

The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic
(The Impact of E-sales on Birth and Death Rate of Businesses in the Czech Republic)

Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective
(Loan-To-Deposit Ratio and Financial Stability: macroprudential policy perspective)

Macroeconomic Determinants of Shadow Banking: evidence from Spain
(Macroeconomic Determinants of Shadow Banking: evidence from Spain)

A Comparative Analysis of Shadow Economy in Croatia and Slovakia
(A Comparative Analysis of Shadow Economy in Croatia and Slovakia)

The changes in capital structure of selected banking markets as a result of new regulations
(The changes in capital structure of selected banking markets as a result of new regulations)

Two Variables Affecting the Economic Value Added (EVA)
(Two Variables Affecting the Economic Value Added (EVA))

The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation
(The Structure of Banks' Assets in Terms of Portfolio Theory and Bank Capital Regulation)

Analysis of the impact of capital structure on business performance
(Analysis of the impact of capital structure on business performance)

Technical Efficiency of Banks Selected countries of Eastern Europe
(Technical Efficiency of Banks Selected countries of Eastern Europe)

Assessing the Impact of the Financial Crisis on Global Insurance Regulation
(Assessing the Impact of the Financial Crisis on Global Insurance Regulation)

Impact of high frequency trading on volatility in short run and long run
(Impact of high frequency trading on volatility in short run and long run)

The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group
(The Application of Sovereign Bond Spreads and the Development of the Stock Market on GDP Prediction: The Case of Visegrad Group)

Empirical Analysis of Farmers’ Winterkill Risk Perception
(Empirical Analysis of Farmers’ Winterkill Risk Perception)

Negative interest rates – consequence staying in error? (empirical evidence)
(Negative interest rates – consequence staying in error? (empirical evidence))

Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey
(Financial Capital Inflows, Current Account Deficit and Economic Growth in Turkey)

The Causal Relationship between Inflation and Interest Rate in Turkey
(The Causal Relationship between Inflation and Interest Rate in Turkey)

The role of accounting in regard to information concerning the convergence of airline business models
(The role of accounting in regard to information concerning the convergence of airline business models)

Impact of cost calculation quality on hospital performance
(Impact of cost calculation quality on hospital performance)

Market Concentration and Stability in European Banking
(Market Concentration and Stability in European Banking)

The Development of Instrument Impact Scenarios with Respect to the Regulatory Policy Model
(The Development of Instrument Impact Scenarios with Respect to the Regulatory Policy Model)

Correlation analysis between macroeconomic indicators and level of ratings in EU countries
(Correlation analysis between macroeconomic indicators and level of ratings in EU countries)

Selected aspects of financial literacy of seniors in Slovakia
(Selected aspects of financial literacy of seniors in Slovakia)

Research of Public Financing Efficiency of Social Well-being in the Russian Federations’ Regions
(Research of Public Financing Efficiency of Social Well-being in the Russian Federations’ Regions)

The impact of barriers in the access to financial products and services on the financial exclusion of the generation 50+ in Poland
(The impact of barriers in the access to financial products and services on the financial exclusion of the generation 50+ in Poland)

The Brief Analysis of the Foreign Trade of the Czech Republic in International Comparison
(The Brief Analysis of the Foreign Trade of the Czech Republic in International Comparison)

Determinants for the development of supplementary pension schemes
(Determinants for the development of supplementary pension schemes)

New trends in banking sector
(New trends in banking sector)

Possibility of Accrual Accounting Application in Case of Active Reserve Forces of the Czech Army
(Possibility of Accrual Accounting Application in Case of Active Reserve Forces of the Czech Army)

Mergers of agricultural enterprises in the Czech Republic
(Mergers of agricultural enterprises in the Czech Republic)

Reporting of Goodwill in Mergers & Acquisitions
(Reporting of Goodwill in Mergers & Acquisitions)

Analysis of Insurance Distribution on the Czech Insurance Market
(Analysis of Insurance Distribution on the Czech Insurance Market)

The Governmental Policy of Budget Balancing in Ukraine
(The Governmental Policy of Budget Balancing in Ukraine)

IPO Non-Financial Factors Influencing the Investors Decisions
(IPO Non-Financial Factors Influencing the Investors Decisions)

Some Considerations on the Green Bonds Market Development
(Some Considerations on the Green Bonds Market Development)

The dynamic relationship between aggregate fund flows and share market returns: Empirical evidence from BRIC
(The dynamic relationship between aggregate fund flows and share market returns: Empirical evidence from BRIC)

Environmental insurance in Poland – The notion, scope and legal determinants
(Environmental insurance in Poland – The notion, scope and legal determinants)

What drives agricultural commodities prices? Mixed-frequency analysis of the agricultural market drivers
(What drives agricultural commodities prices? Mixed-frequency analysis of the agricultural market drivers)

Effect of zero lower bound on large firms financing in the Czech Republic
(Effect of zero lower bound on large firms financing in the Czech Republic)

Assessment of Impact of Items Reducing Tax Base and Tax on Total Amount of Corporate Income Tax in the Czech Republic in Selected Periods
(Assessment of Impact of Items Reducing Tax Base and Tax on Total Amount of Corporate Income Tax in the Czech Republic in Selected Periods)

Brexit Implications on the Czech Republic via GNI Based Contributions to the EU Budget
(Brexit Implications on the Czech Republic via GNI Based Contributions to the EU Budget)